In an article entitled “‘Gotcha Game,’” The National Law Journal reported last year on a “rising tide of challenges to arbitration awards [that] threatens to undermine the system.”1 The article focused on challenges alleging “evident partiality” on the part of an arbitrator, and observed that a “wide jurisdictional disparity regarding what constitutes partiality” was compounding the added time and expense inherent in any judicial challenge to an award.2 But the last year has brought new clarity to the standard for evident partiality applied by the U.S. Court of Appeals for the Second Circuit and now by state courts in New York. This article traces the evolution of that standard, concluding with two recent cases that clarify the law—the Second Circuit’s Scandinavian Reinsurance Co. v. St. Paul Fire & Marine Ins. Co. opinion3 and the N.Y. Court of Appeals’ decision in U.S. Electronics Inc. v. Sirius Satellite Radio Inc.4
More Issues Raised Than Resolved
Section 10(a)(2) of the Federal Arbitration Act (FAA) empowers a federal district court to vacate an arbitration award “where there was evident partiality or corruption in the arbitrators, or either of them.”5 New York state courts also apply the FAA when the dispute affects interstate commerce.6 Any “jurisdictional disparity” regarding the meaning of evident partiality primarily results from a lack of clear guidance from the U.S. Supreme Court. Its only evident partiality case—Commonwealth Coatings Corp. v. Continental Casualty Co., decided in 19687—prompted 40 years of debate on whether the plurality opinion of Justice Hugo Black or the concurring opinion of Justice Byron White should be followed, with most courts concluding that the plurality opinion does not control.8
